Water infrastucture – out of sight, out of mind?

If most of the water infrastructure in the Western world was laid in the early to mid-20th century, and have a lifespan of some 75-100 years, you can do the math to understand that we might have a situation brewing underground.

One of the biggest challenges municipalities face entering the 2020’s is their massive aging water supply and disposal infrastructure. For many of us, the underground pipes are buried and out of mind – although they enable a service we could not do without. Leaving this infrastructure unattended is a big ad-hoc cost item for modern societies. Piping, of course, is not the only challenge. Also the water treatment plants are aging and often not up-to-speed with the latest technological advances.

Keeping the water networks in good shape requires proactive preventive maintenance, not panic-fixes when they’re already failing. For municipalities, this is a tough equation, with tight budgets and efficiency pressures. For policymakers it is equally challenging to face the unpopularity of raising tariffs and taxes, and finding other funding alternatives.

Europe: huge differences in water pricing

In Europe, there are some 7 million kilometres of water pipes running across the region. The state of this infrastructure as well as water pricing approaches vary greatly from country to country. Some citizens pay a very nominal flat fee regardless of the amount used. In other places, transparent and advanced pricing policies have been adopted, including “polluter pays” principles.

Whether lower or higher, the water tariffs collected from citizens do not cover the full costs of the water supply and disposal system, which consist of

indirect costs, like repairs of damages or extra costs caused by regulatory changes.

US: 240,000 water-main breaks per year

In the US, drinking water is delivered via one million miles of pipes across the country (and this is just the supply side, add the wastewater disposal into the equation for a full picture). According to the American Society of Civil Engineers, much of this infrastructure is nearing the end of its useful life. This is causing some 240,000 water-main breaks each year – resulting in not only water loss but also costly damages to roads, buildings and other infrastructure. The American Water Works Association estimates that it would cost more than $1 trillion to bring this network back up-to-speed, for the piping only.

Recognizing the true value of clean water

The key challenge here is, one might argue, that the whole water infrastructure is taken for granted – and water itself is a highly undervalued resource. Water supply and disposal links directly to a number of global megatrends, such as urbanization, growing population and climate change – all of which put more pressures on the existing system. We expect to get the water, but are not willing to pay much for it.

“Understanding the real costs of supplying drinking water and treating wastewater in each specific location – and making these costs more transparent, would be a good start. An easy analogy might be the model for electricity pricing, where – at least in many European countries – the consumer sees how much they’re paying for the production and distribution,” says Riikka Timonen, Director of Marketing at Kemira. “We participate in the clean water cycle by supplying chemistries for raw and wastewater treatment. Here, too, cost-pressures are massive as the global costs for raw materials and logistics keep creeping up. It’s a real complex balancing act for us and our customers alike.”

One way of maximizing the capacity of the existing assets is to take advantage of opportunities offered by digitalization. “Smart process management and automation have a positive impact on asset lifecycle and cost optimization, as do the right chemistries, too” Riikka points out.

Water should be priced at a level which both encourages efficient use and properly reflects its cost.

EEA

Droplets like diamonds

The European Environment Agency states that water should be priced at a level which both encourages efficient use and properly reflects its cost. It might seem that water is plentiful, but of all the water on Earth, only 3% is freshwater. Another thing to note is that, according to the World Economic Forum, irrigated agriculture currently draws some 70% of this water – that is, the crops grown in order to feed us.

Our water supplies are finite and essential for life. The famous diamond-water paradox (paradox of value) formulated by the economist Adam Smith in the 1700s states that practical things used every day often have little or no value in exchange (water). On the other hand, things that often have the greatest value in the market have little or no practical use (diamonds). Does clean water need to become a luxurious rarity in everyday life, in order for us to recognize its true value?